Hi friends! Today I have a debt-free interview for you from Amber at thegreatbudgetlife.com! She and her husband are working on getting out of some serious debt by making small sacrifices that have sure been adding up. And I’m sure their story will be an encouragement to you if you’re working on your own debt-free journey. Read and enjoy!
Hello! My name is Amber, and I write thegreatbudgetlife.com. In June of 2017, my husband and I set out to tackle almost $78,000 of debt in 24 months. We’re your typical post-college adults that have way too much student loan debt.
Fortunately, we made a life-changing budget before we got too comfortable in the American way of living: with loads of debt. I hope our story can inspire other young adults or even not-so-young adults to do something crazy and change their lifestyle to make positive and lasting financial changes that will quite literally “pay off” for years to come.
1. What kind of debt did you have? How much was it? And how long will it take to pay off?
When I graduated from college, I had about $28k in student loan debt, my husband had around $40k, and then we purchased a car and got a loan for around $10k. So when we started our debt payoff journey in June 2017, we were sitting on almost $78,000 in debt. We have a 24 month payoff plan, but we’re hoping to shave that down by a few months if we can!
2. Why did you decide to pay off your debt?
We decided to pay off our debt so rapidly because debt means you are trapped in a never-ending cycle of payments going out. It felt impossible to build any kind of wealth with $1,000 a month going out to minimum payments. I didn’t want to keep that up forever!
What happens when we have a family and a lot more of normal life expenses to worry about? I wanted to make sure the debt was gone before we decided to take on any more “life,” if that makes sense- like a house, kids, etc.
I wanted to feel in control, especially if one of us lost a job. Living in an expensive city like Dallas, rent is astronomical. On one income, we would not be able to make rent and our minimum debt payments!
3. What strategies did you use to pay off your debt? What was the craziest thing you did to get out of debt?
We obviously have created a very detailed budget. The craziest thing we are doing is working that budget to ensure we make HUGE debt payments each month. To do that, we have to plan. In a given month, our “living expenses” are around 40% of our take-home pay, the rest going to charity and debt.
I would consider rent, transportation, food, and regular bills to be living expenses. Obviously this means we aren’t enjoying a lot of “extras” right now. I also just got a part-time job working remotely for Stitch Fix, so that’s going to help too!
4. How has your family been impacted by your financial journey?
If I’m being honest, my husband and I did not come from high standards of living, so the sacrifices we’ve had to make have been relatively easy. We’ve always driven old cars, and shopped for deals on clothes (ain’t no shame in shopping at Goodwill). We’ve gone without some things that most people today would consider necessities like having cable, eating out each week, having the newest and greatest gadget, etc. So the hardest part for us is just being mentally prepared.
We make sure our meals are planned and try to avoid the impulsive trips to fast-food places. We avoid impulse shopping or shopping online, and just being content with what we already have in general. For me and my husband, this is kind of all we know! It’s definitely been a fun journey, one I’m sure we will look back on one day and be like “wow, how did we do that?”
5. What was the hardest part about getting out of debt?
It’s hard to say “no” when your friends invite you out to the movies or to go out every Wednesday night after Bible study, but we know it’s the little things and sacrifices that add up and can get us off track. It’s also been hard not to eat out a lot. That’s probably what we miss the most! We still eat out – just definitely not as often as I actually want to.
6. What are your goals once you become debt-free?
Well we are about to be $20,000 down and $57,000 to go, but once we get the rest knocked out, our first goal will be a vacation (Canada? Hawaii?) and then saving for a down payment on a house.
7. How do you think your life will change once you’re debt-free?
I think it will be nice not having this big cloud of debt doom hanging over my head at all times. It’s nice to know that we can afford a little splurge every now and then and that we can focus on long-term goals. We couldn’t really do that before because we were always looking back, not forward.
8. Tell us about your blog! What’s it about and why did you start one?
Ah, yay! So my blog is thegreatbudgetlife.com and I started this as a way to chronicle our experience of rapid debt payoff. But also as a way to share with my peers (most of whom went to an expensive private University like I did!) that doing something radical with your finances is possible, even if it doesn’t feel like it.
I think a lot of young adults step into the real world and feel like they can have anything they want and make some not so smart decisions to get those things. Then they wake up one day and they’re like “What have I done?” I want people my age to know that YOU are in control of your life, regardless of your income level, what debt you have, where you live, what you’ve got going against you in life – YOU CAN DO IT. It’s a lifestyle.
Budgets create freedom and a little financial knowledge can go a very long way. I think the first step, like most self-help solutions, is to realize that you have a problem. With money, it’s not always so easy to see because the American way of doing money is so normalized, we don’t even see something is wrong until we’re in too deep.